I. TRIBUNAL
6. [2019] (28) GSTL 478 (Tri-Chan.) DLF Cyber City
Developers Limited vs. Commissioner of S.T., Delhi-IV Date of order: 22nd May, 2019
Activity of corporate
guarantee to banks / financial institutions is not liable for service tax in
absence of consideration
FACTS
The
appellant provided corporate guarantee to various banks / financial
institutions on behalf of their holding companies / associate enterprises /
joint ventures. SCN was issued on the presumption that their associates had received
loan facilities from financial institutions at a lower rate, therefore the
differential amount was consideration liable to tax. The Revenue, however, did
not produce any evidence in the matter; on the other hand, the assessee
contended that they did not receive any consideration, thus no tax was payable.
HELD
It
was held that since no consideration was received by the appellant for
providing corporate guarantee and the SCN was based merely on presumption, the
appellant was not liable for payment of tax.
7. [2019] TIOL-2734 (CESTAT-Mum.)
M/s S.S. Construction vs. Commissioner of Central Excise Date of order: 4th
June, 2019
Rejection of CA
certificate for want of supporting documents cannot be sustained
FACTS
The
appellant provides ‘commercial and industrial construction service’, ‘manpower
recruitment and supply service’, etc. On comparison of the balance sheet with
their ST-3 returns, a short payment was found; hence a show-cause notice was
issued. The Tribunal, vide order dated 20th September, 2012,
remanded the matter to the adjudicating authority for reconciliation of the
balance sheet with the ST-3 returns. On reconciliation, both the authorities
below confirmed the demand issued earlier with interest and penalty. Hence the
present appeal.
HELD
On
remand by the Tribunal, since the appellant had already earlier submitted the
details of profit and loss account, ledger, invoices, bills, etc., they also
placed the C.A. certificate in support of their claim for reconciliation of the
figures between the ST-3 returns and the balance sheet. The authority rejected
the C.A. certificate on the ground that the supporting documents were not
enclosed along with the certificate.
The
Tribunal noted that there is no justification in the findings of the lower
authorities inasmuch as all the documents were submitted and the rejection of
the C.A. certificate for want of supporting documents cannot be sustained.
Since the appellant was able to reconcile the differential figures between ST-3
returns and the balance sheet supported by the C.A. certificate, the Tribunal
allowed the appeal.
8. [2019] TIOL-2945 (CESTAT-All.) M/s Mega Trends
Advertising Ltd. vs. Commissioner of Central Excise and Service Tax Date of order: 21st February, 2019
Production
of design given by the client on chosen material such as cloth, PVC sheet,
etc., would not amount to providing a service taxable as advertising agency.
Further, longer period of limitation also would apply as the figures were
picked up from the balance sheet and profit and loss account and thus there was
no suppression of facts
FACTS
The
assessee was engaged in supply and installation of hoardings as well as printing
activities. With respect to the printing activity, they merely carried out
printing operations on the instructions of clients on the given material. There
was no creativity involved and they acted merely as printers and thus the
activity was not liable for service tax. On scrutiny of the appellant’s
financials, there was excess income found and hence a show-cause notice was
issued for evasion of service tax.
HELD
The
Tribunal, relying on the decision in Avon Awning vs. CCE & ST [2017]
(51) STR 33 (Tri.-All.) where it was categorically held that production
of design given by the client on chosen material such as cloth, PVC sheet,
etc., would not amount to providing any service taxable under the category of
advertising agency, and thus set aside the demand on merit. The Tribunal also
noted that the appeal was barred by limitation as the figures were picked up
from the financials which are public documents; hence the charge of suppression
was held unsustainable.
9. [2019] (28) GSTL 279 (Tri.-Chan.) Great India Steel
Fabricators vs. Commissioner of C. Ex. & ST, Panchkula Date of order: 14th February, 2019
Refund claim of CENVAT
credit to be sanctioned in cash in view of section 142 of CGST Act, 2017
FACTS
A
refund claim was filed by the appellant for the refund of unutilised CENVAT
credit on export of goods. The Department sanctioned the claim amount, partly
in cash and partly credited in the CENVAT credit account. The appellant filed
an appeal on the basis of section 142 of the CGST Act, 2017 requesting to
modify the impugned order and sanction the whole refund in cash.
HELD
Section
142 of the CGST Act, 2017 deals with situations which direct the authorities to
sanction all the refund claims in cash. Therefore, the appellant was entitled
for refund in cash. Allowing the appeal, the order was modified to the extent
the amount was credited to CENVAT credit account and thus the cash refund was
allowed.
10. [2019] (28) GSTL 96 (Tri.-Ahmd.) Commissioner of
CESTAT vs. Reliance Industries Ltd. Date of order: 12th March, 2019
While calculating CENVAT
credit reversal as per rule 6(3A) of CENVAT Credit Rules, 2004, total CENVAT
credit shall mean credit of only common input service and does not include
input service exclusively used for manufacturing dutiable goods which are
entitled to full credit
FACTS
The assessee supplied dutiable as well as
exempted goods through various units. In terms of Rule 6 of CCR, they did not
avail CENVAT credit of tax paid on inputs and input services used exclusively
in the manufacture of exempt goods. Likewise, they availed the entire amount of
CENVAT credit of tax paid on inputs and input services used exclusively for the
manufacture of dutiable goods. They also received input services commonly
consumed for manufacture of exempt and dutiable goods. They calculated the
amount of common credit reversal by apportioning ‘Total CENVAT credit’ as per
Rule 6(3A)(c)(iii) as existed during the relevant period. However, they contended
that for the purpose of apportioning the CENVAT credit on common input
services, the total CENVAT credit cannot be taken since the same also includes
credit on input services which were exclusively used in the manufacture of
dutiable goods. Therefore, they re-calculated the amount of CENVAT reversal by
taking only ‘common CENVAT credit’. Thus, due to excess CENVAT credit reversal
earlier, the assessee filed a refund claim. The adjudicating authority
contended that the respondent had rightly reversed CENVAT originally. The
amendment in Rule 6(3A) brought by Notification No. 13/2016-C.E. dated 1st
March, 2016 did not apply retrospectively and hence, no refund was granted.
HELD
It
was held that the legislators very consciously substituted sub-rule 6(3A) with
an intention to give a clarification to the provision so as to make it
applicable retrospectively. Therefore, for the purpose of reversal of common
credit, total CENVAT credit should mean credit of only common input services
and not of credit exclusively used for manufacturing of dutiable goods.
11. [2019] (28) GSTL 278 (Tri.-Chan.) Central Public
Works Department vs. Commissioner of Central Excise, Gurgaon-1 Date of order: 10th October, 2018
Section
11B of Central Excise Act, 1994 entitles a person to get the refund when he has
suffered the duty
FACTS
A
contractor had executed a works contract for the appellant who also paid
service tax on it. Later, the service was exempted from the payment of service tax.
The appellant filed a refund claim of the service tax borne by him, which was
paid by the contractor to the government. The Department rejected the claim on
the ground that the service tax was not paid by the appellant.
HELD
It
was held that the appellant had borne the duty and thus was eligible for the
refund. As per the Hon’ble Supreme Court in the case of Mafatlal Ltd. vs.
UOI 1997 (89) ELT 247 (SC), in terms of section 11B of the Central
Excise Act, 1994 a person who has borne the duty can get the refund. Hence the
impugned order was set aside and the appeal was allowed with consequential
relief.
12. [2019] (28) GSTL 280 (Tri.-Mum.) C.S.T., Mumbai-II
vs. Reliance Communications Infrastructure Ltd. Date of order: 8th February, 2019
Order passed without
considering submissions is a mistake apparent from records and miscellaneous
application filed merits consideration for recalling such order
FACTS
On
18th January, 2018 an appeal was heard and the order was reserved,
directing both the sides to file written submissions within two weeks. The
written submissions were filed by the Revenue through its authorised
representative along with other documents on 1st February, 2018.
However, such written submissions were not placed in the file and it was
evident that the Tribunal passed the order without considering the submissions.
Therefore, a miscellaneous application for rectification of mistake apparent on
record was filed.
HELD
It was held that the
order passed by the Tribunal was an apparent mistake on the face of the record
as it was passed without considering the submissions. Therefore, the
miscellaneous application filed by Revenue merits consideration for recalling
the order and hearing of appeal afresh.
